LexisNexis® Legal Newsroom
    Mealey's Insurance - Insurer Failed To Prove Denial Was Justified Based On Insured's Late Notice

    PITTSBURGH - An insured sufficiently alleged facts in support of a bad faith claim against an insurer for failure to investigate a property damage claim caused by a burst water pipe, a Pennsylvania federal judge said July 17, noting that the insurer failed to prove that it was prejudiced by the insured's late notice of the coverage claim (FAPD LLC v. Auto-Owners Insurance Co., No. 18-0428, W.D. Pa., 2018 U.S. Dist. LEXIS 118776).

    Mealey's Insurance - Excess Reinsurer's Agent Dismissed From Breach Of Contract Lawsuit

    MIAMI - An insurance agent for an excess reinsurer was dismissed by a Florida federal judge on July 18 from an international health insurer's breach of contract lawsuit because the agent was not a party to the contract in dispute (VIP Universal Medical Insurance Group Ltd. v. BF&M Life Insurance Company Ltd., et al., No. 17-24633, S.D. Fla., 2018 U.S. Dist. LEXIS 120904).

    Mealey's Insurance - Panel Reverses Arbitration Ruling In Contract Dispute Against Contractor, Surety

    LAKELAND, Fla. - In a breach of contract dispute involving a contractor, subcontractor and a surety, a Florida appeals panel on July 18 reversed an order finding that an arbitration clause in a subcontract is void and unenforceable because if the Federal Arbitration Act (FAA) applies, it preempts a Florida statute (Sacshe Construction and Development Corp. v. Affirmed Drywall Corp., et al., No. 2D17-4276, Fla. App., 2nd Dist., 2018 Fla. App. LEXIS 9998).

    Mealey's Insurance - Panel Enters Judgment In Favor Of Insurer In Defects Coverage Dispute

    LAKE CHARLES, La. - Reversing and remanding a lower court's ruling, a Louisiana appeals panel on July 18 entered summary judgment in favor of an insurer and dismissed a third-party demand for the insurer's alleged failure to provide coverage for defect claims (Shane Pierce, et al. v. Irma M. Rodriguez, et al., No. 17-681, La. App., 3rd Cir., 2018 La. App. Unpub. LEXIS 214).

    Mealey's Insurance - 6th Circuit Allows Amicus Briefs Seeking Rehearing Of Medicare Billing Case

    CINCINNATI - A Sixth Circuit U.S. Court of Appeals panel on July 16 granted requests from the Washington Legal Foundation (WLF) and National Association for Home Care & Hospice Inc. (NAHCH) to submit amicus curiae briefs in support of a nursing home facility's request for an en banc hearing as to whether a former worker sufficiently alleged that the company made material misrepresentations under the False Claims Act (FCA) when failing to timely submit physician certification to support treatment provided to patients (United States, ex rel. Marjorie Prather v. Brookdale Senior Living Communities Inc., et al., No. 17-5826, 6th Cir.).

    Mealey's Insurance - Judge Holds Distributors Were Excluded By Plan, Dismisses ERISA Claim

    ATLANTA - An Atlanta federal judge on July 16 granted summary judgment in favor of bakery businesses on claims asserted by independent contractors that they violated the Employee Retirement Income Security Act by refusing to offer them benefits under a 401(k) Retirement Savings Plan, holding that the terms of the plan expressly excluded contractors and distributors from receiving benefits (Pete Ryan, et al. v. Flowers Foods, Inc., et al., No. 1:17-CV-817, N.D. Ga., 2018 U.S. Dist. LEXIS 117759).

    Mealey's Insurance - Federal Judge Grants Injunction Enjoining Pennsylvania Act 41 From Taking Effect

    HARRISBURG, Pa. - A Pennsylvania federal judge on July 18 held that a plausible constitutional question is raised by the recently signed into law Pennsylvania Act 41's "attempted ipse dixit transfiguration" of the Pennsylvania Professional Liability Joint Underwriting Association's "private assets into public property," finding that the association will incur imminent and irreparable harm if the act is not prohibited from taking effect (Pennsylvania Professional Liability Joint Underwriting Association v. Tom Wolf, No. 18-1308, M.D. Pa., 2018 U.S. Dist. LEXIS 119438).

    Mealey's Insurance - Ambulance Company To Pay $16,776 For Submitting False Claims

    BANGOR, Maine - An ambulance company has agreed to pay the federal government and state of Maine $16,776.74 to resolve claims that it submitted false bills to Medicare and Maine's Medicaid program, MaineCare, from January 2015 through April 2016 to pay the salary of an employee who had previously been excluded from participating in federal and state health care programs, according to a notice of settlement filed July 17 in Maine federal court (United States v. County Ambulance Service Inc., No. 18-cv-280, D. Maine).

    Mealey's Insurance - Pennsylvania High Court Refuses To Hear Appeal In Environmental Dispute

    HARRISBURG, Pa. - The majority of the Pennsylvania Supreme Court on July 18 denied an insurer's petition for review in an environmental contamination coverage dispute on the basis that the trial court's continuous trigger ruling was not a final ruling (Pennsylvania Manufacturers' Association Insurance Co. v. Johnson Matthey Inc., et al., No. 24 MAP 2017, Pa. Sup., 2018 Pa. LEXIS 3670).

    Mealey's Insurance - Insurer Files Breach Of Contract Counterclaim Against Reinsurers

    NEW YORK - An insurer counterclaimed for breach of contract on July 16 against two reinsurers in a New York federal court, seeking a declaration that the insurer cannot arbitrate claims asserted under facultative reinsurance contracts for losses of $2.5 million (Continental Insurance Company of New Jersey, et al. v. National Union Fire Insurance Company of Pittsburgh, PA, No. 18-4715, S.D. N.Y.).

    Mealey's Insurance - Federal Judge Extends Class Certification Motion Deadline In Reinsurance Dispute

    SACRAMENTO, Calif. - A California federal judge on July 17 extended deadlines for a class certification motion, a response and a reply in two putative class actions over a reinsurance participation agreement (RPA) (Shasta Linen Supply Inc. v. Applied Underwriters Inc., et al., Nos. 16-00158 & 16-01211, E.D. Calif.).

    Mealey's Insurance - Insurer Has Standing To Pursue Declaratory Judgment Claim, Judge Says

    ALBUQUERQUE, N.M - A commercial general liability insurer has standing to assert a declaratory judgment claim against a condominium association in a coverage dispute over an underlying construction defects action, a New Mexico federal judge ruled July 16 (United Fire and Casualty Co. v. Caskey Drywall NM LLC, et al., No. 17-1108, D. N.M., 2018 U.S. Dist. LEXIS 117982).

    Mealey's Insurance - Insureds' Bad Faith Claim In Water Damage Suit Is Sufficiently Supported

    PHILADELPHIA - A Pennsylvania federal judge on July 17 denied an insurer's motion to dismiss a bad faith claim in a water damage coverage dispute after determining that the insurer failed to offer sufficient evidence in support of its argument that its coverage denial was reasonable (Overbrook Properties LLC, et al. v. Allstate Indemnity Co., No. 18-630, E.D. Pa., 2018 U.S. Dist. LEXIS 119389).

    Mealey's Insurance - Federally Reinsured Crop Insurance's Interpretation Upheld By 8th Circuit

    ST. LOUIS - The Eighth Circuit U.S. Court of Appeals on July 17 affirmed the entry of summary judgment to federal agencies on their interpretation of federally reinsured crop insurance policies that resulted in the denial of four farms' claims for indemnity (Bottoms Farms Partnership, et al. v. Sonny Perdue, et al., No. 17-2164, 8th Cir., 2018 U.S. App. LEXIS 19609).

    Mealey's Insurance - Judge: Assignee Fails To Show Professional Liability Insurer Acted In Bad Faith

    PHILADELPHIA - A Pennsylvania judge on July 13 found that an insured's assignee failed to demonstrate any conduct on the part of a professional liability insurer and attorneys that even remotely indicates that they acted in bad faith or committed professional negligence in defending the insured against an underlying professional malpractice lawsuit (Anastasios Papadopoulos v. Westport Insurance Co., et al., No. 03367, Pa. Comm. Pls., Philadelphia Co.).

    Mealey's Insurance - Judge Dismisses UCL Claim Related To Insurance Sales, Grants Leave To Amend

    LOS ANGELES - A California federal judge on July 12 granted motions filed by insurers to dismiss claims against them in relation to an alleged unlawful scheme that involved one insurer profiting from the sale of its policies on behalf of two other insurers, holding that insureds failed to state claims for relief under California's unfair competition law (UCL), false advertising law (FAL) and for financial elder abuse, but the judge granted them leave to file an amended complaint (Simon Levay, et al. v. AARP Inc., et al., No. 17-09041, C.D. Calif., 2018 U.S. Dist. LEXIS 116585).

    Mealey's Insurance - Insurance Policies Possessed By Nonparty Are Relevant, Magistrate Judge Says

    BUFFALO, N.Y. - A nonparty company named as a defendant in underlying asbestos suits, along with an insured, must provide an insurer with information about insurance policies it possessed because the policies are relevant in determining the insurer's coverage obligations to its insured, a New York federal magistrate judge said July 16 (American Precision Industries Inc. v. Federal Insurance Co., et al., No. 14-1050, W.D. N.Y., 2018 U.S. Dist. LEXIS 117900).

    Mealey's Insurance - Insureds' Mold Coverage Suit Remanded To Louisiana State Court

    NEW ORLEANS - A Louisiana federal judge on July 13 granted a motion to remand a mold coverage suit filed by insureds after determining that the insurer failed to prove that the insurance agency was fraudulently joined to defeat diversity jurisdiction (Allen T. Jackson, et al. v. QBE Specialty Insurance Co., et al., No. 17-11730, E.D. La., 2018 U.S. Dist. LEXIS 116990).

    Mealey's Insurance - Bank For Clinic Accused Of Fraud Must Produce Records, Magistrate Says

    TAMPA, Fla. - A health care clinic and doctor accused of submitting fraudulent medical bills for automobile accident victims to the Government Employees Insurance Co. (GEICO) failed to have a subpoena served on their bank quashed after a federal magistrate judge in Florida ruled July 16 that the records were relevant and not protected from disclosure (Government Employees Insurance Company v. Analgesic Healthcare Inc., et al., No. 17-cv-1130-T-27AAS, M.D. Fla., 2018 U.S. Dist. LEXIS 117887).

    Mealey's Insurance - Federal Judge Stays Coverage Suit Over Claims Cell Phone Tower Damaged Building

    SEATTLE - Exercising inherent authority, a Washington federal judge on July 13 paused T-Mobile Northeast LLC's lawsuit seeking coverage for alleged damage caused by a cell phone tower to allow two related lawsuits to proceed (T-Mobile Northeast LLC v. Selective Insurance Company of America, No. 17-1289, W.D. Wash., 2018 U.S. Dist. LEXIS 117694).

    Mealey's Insurance - California Man Sues Used Car Seller, Shell Reinsurer For Fraud

    FRESNO, Calif. - A California man filed a complaint on July 12 in a California court against a used-vehicle seller and its affiliates, including an illegal shell reinsurance company, accusing them of being involved in three fraudulent schemes in the sale of used vehicles and violating California' unfair competition law (UCL) (Richard Harkins v. Paul Blanco's Good Car Company Fresno Inc., et al., No. 18CECG02582, Calif. Super., Fresno Co.).

    Mealey's Insurance - Federal Judge Rules On Motions In Limine In Coverage Suit Over Tornado Damage

    OKLAHOMA CITY. - An Oklahoma federal judge on July 13 granted in part and denied in part an insurer's motion in limine and denied the insured's motion in limine in its entirety in a coverage dispute over property damage caused by a tornado (Charles A. Shadid LLC v. Aspen Specialty Insurance Co., No. 15-595, W.D. Okla., 2018 U.S. Dist. LEXIS 117188).

    Mealey's Insurance - California Panel Affirms Restitution Amount For Unemployment Benefits Fraud

    SAN FRANCISCO - A California appeals court panel on July 16 affirmed a trial court's ruling requiring a flower shop owner to pay $14,200 in restitution to a former employee after she pleaded no contest to fraud charges stemming from her failure to pay for unemployment and workers' compensation insurance, finding that while the former employee's work records "were a mess," the trial judge properly calculated the amount needed to make the victim whole (People of California v. Cynthia Ann Smith, No. A153490, Calif. App., 1st Dist., 5th Div., 2018 Cal. App. Unpub. LEXIS 4769).

    Mealey's Insurance - Judge: Insurance Bad Faith Suit Barred By Doctrine Of Laches

    LAS VEGAS - Summary judgment in an insurance bad faith lawsuit is appropriate because an insurer has shown that a plaintiff engaged in an unreasonable delay in bringing his lawsuit against the insurer for failure to pay death insurance benefits and are, thus, barred by laches, a federal judge in Nevada ruled July 12 in granting the insurer's motion for summary judgment (Richard Lucas-MacGibbon v. USAA Life Insurance Co., No. 17-1348, D. Nev., 2018 U.S. Dist. LEXIS 115914).

    Mealey's Insurance - Delaware High Court Says No Coverage Owed As Policies Were Not Validly Assigned

    DOVER, Del. - The Delaware Supreme Court on July 16 reversed a lower court's ruling in favor of an insured in an asbestos coverage dispute after determining that Texas law, which does not recognize the assignment of insurance policy rights without an insurer's consent, applies to the policies at issue and, therefore, no coverage is owed under the policies because the insured did not obtain the insurer's consent before assigning the policies at issue (The Travelers Indemnity Co. v. CNH Industrial America LLC, No. 420, 2017, Del. Sup., 2018 Del. LEXIS 334).